Lew slams Gillard government over online tax

Shopping mogul
Solomon Lew
and his retail chief
Mark McInnes
have lashed out at the Gillard government, unions and landlords over online tax loopholes, penalty rates and excessive rents.

Mr Lew, the chairman of Premier Investments, and Mr McInnes, the chief executive of the
Just Group
, warned that more retail jobs would be lost and more stores would close unless the government reduced the GST-free threshold for overseas online purchases, unions agreed to lower weekend penalty rates and landlords reduced rents to more sustainable levels.

Mr McInnes attacked the “hypocrisy" of the Gillard government “on one hand going to western Sydney and saying they support local jobs and on the other hand destroying local jobs" by failing to act fast enough to reduce the GST-free threshold for online purchases.

“It’s very hypocritical of the Prime Minister to say she’s interested in jobs when an Ernst & Young report released last year showed 35,000 retail jobs would be lost in three years," he said.

Local retailers disadvantaged

“It’s a disgraceful position to take when what’s really going on in retail is there’s an unfair advantage for international retailers over Australian retailers and it’s purely because of government policy and it’s completely unacceptable," he said.

Australian retailers were also struggling to achieve productivity gains when penalty rates remained high, he said.

Last week, the Fair Work Commission upheld penalty rates in retail, fast food and other sectors after ruling that employers had failed to show that the payments had led to job cuts and poor business performance.

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Retailers had been seeking penalty rates of 50 per cent on Sunday instead of the current 100 per cent penalty or double time.

“Customers aren’t relaxing on their couches on weekends, they’re out shopping and the fact we have to pay higher penalty rates for that is ridiculous," Mr McInnes said.

“The government has its head in the sand."

Mr Lew said landlords were still looking for 4 to 5 per cent rent increases when shopping centre sales were down three or four per cent.

“Landlords have to get realistic otherwise they’ll have vacancies – it’s tough out there," he said.

Store closures

Premier Investments, which owns Just Jeans, Jay Jays, Dotti, Portmans, Jacqui E, Smiggle and Peter Alexander, closed 14 loss-making stores in the first half of 2013 and says more stores may close unless rents are more sustainable.

“We don’t want to be closing stores - the government and unions have to take responsibility for that," Mr McInnes said.

Landlords were also “in denial" about the growth of online and mobile shopping and the impact on bricks and mortar retailers, Mr McInnes said.

“Thirty per cent of online sales in Dotti and Portmans are coming from mobile – customers are already there,’ he said.